Case Study

Executive Profile Series: XYZ Corp.

In the mid ‘90’s, a former in-house manufacturing division of
ABC Corp. made its debut as an independent company. Its name was XYZ Corp., and
its specialty was producing high-tech widgets used in telecommunications gear,
high-tech medical industry testing and measurement devices. Backed by proceeds
from an initial public offering, the company grew steadily over its first 11
years, building a reputation as an agile, reliable provider of high-performance
widgets. Its fiscal revenues rose to a record of nearly $200 million.

A bold transaction in 2005, however, would transform XYZ. In
April of that year, the company’s board of directors agreed to an acquisition
of an Asia-based supplier of widgets. With the acquisition, XYZ not only
expanded its manufacturing capability and improved its cost efficiencies, but
also elevated its global presence and its ability to serve a growing base of
customers in Asia and elsewhere.

Devising the appropriate mix of management and financial
resources to integrate a new international operation required a deft touch from
the company’s senior management team. To support the effort, XYZ turned to CFO
Insight LLC.

Situation

XYZ engaged CFO Insight LLC in November on what initially
was construed as a short-term assignment, with two primary goals in mind. One
was to fill in an acting chief financial officer role while the company sought
out a permanent successor to its retiring incumbent. The second: to help
fashion guidelines and processes for integrating the company’s newly acquired
Asia operations.

XYZ was looking for more than just an experienced corporate
finance executive. With the acquisition of ASIA, the company’s profile had been
reshaped. No longer a regional U.S. manufacturer, XYZ was a global provider
with an opportunity to scale its operations dramatically. The expanded profile
demanded an executive with experience in international business, international
merger and acquisition work, and public company experience. An executive search
effort to identify the right candidate had been under way for several months,
and remained ongoing, when XYZ enlisted CFO Insight LLC in November 2005.

Why CFO Insight LLC?

The CFO Insight LLC Partner engaged by XYZ brought an ideal
pedigree to the assignment: More than 30 years of corporate finance experience
for publicly held companies, plus a deep history of involvement with
international manufacturing operations, audit, investor relations, mergers and
acquisitions, ERP systems implementation and global consulting. The Partner
also is a published author who has written extensively about strategies tied to
company integration and international business.

XYZ executives also believed CFO Insight LLC was the right
choice to support the company’s integration and expansion efforts because of CFO
Insight LLC bench depth. By calling on additional CFO Insight LLC partners to
provide guidance and advice concerning details of international business and
integration issues, XYZ could enjoy the collective contributions of dozens of
Partners with literally decades of experience.

Results

Even before joining the XYZ senior management team at its
headquarters, CFO Insight LLC had conducted a preliminary evaluation of the
ASIA acquisition, studying the financial and corporate planning considerations
behind the deal.

Upon arrival, CFO
Insight LLC began to work with XYZ on a comprehensive review of the integration
needs tied to the new Asia operations. One of the key strategies to emerge from
the collaboration was an understanding that the new assets could largely be
operated within the existing general management structure of XYZ. That
viewpoint helped to shape secondary decisions tied to functional integration of
engineering, sales and marketing, and manufacturing operations.

Among key
initiatives supported by CFO Insight LLC were:

Developing
and implementing new internal reporting processes. A new format for
monthly reports provided senior management with new visibility and clarity
into financial impacts of business decisions.

Developing
and implementing a new forecasting and annual planning process. The more
regimented approach to projecting performance helped to define budgets and
support resource allocation decisions.

Completing
a comprehensive strategic plan. The document spells out long-term goals
and objectives and provides a blueprint for XYZ next era of business
growth.

Integrating
the operations of a smaller acquisition made by XYZ into full compliance
with the company’s overall accounting and business-process practices. The
integration ensured full compliance with dictates of the Sarbanes-Oxley
Act of 2002.

Assisted
in the evaluation and selection of a new ERP system.

Finally, CFO Insight LLC also was instrumental in preparing
for and completing a $70 million public debt offering, proceeds of which would
be used to pay down bank debt and strengthen XYZ balance sheet. CFO Insight LLC
worked closely with the securities firm that represented the offering to convey
XYZ corporate strategy, business planning process and long-term objectives. CFO
Insight LLC articulation of the company’s business strategy and growth
prospects provided the investment banking firm with the confidence it needed to
bring the offering successfully to market.

What began as a two-month assignment for CFO Insight LLC
ultimately spanned a nine-month period of transformation during which XYZ
doubled in size, integrated a strategically critical global acquisition,
delivered lasting improvements in financial reporting and business planning,
and refinanced its public and bank debt. CFO Insight LLC contribution was
completed as XYZ named a full-time CFO in August 2006.